The real work begins: Why the second half of the decade demands a shift in payments strategy

Core Insights - The payments industry is transitioning to a phase of execution at scale as the end of 2025 approaches, marked by significant milestones such as the completion of ISO 20022 migration for Fedwire and new legislation mandating speed and inclusivity in US financial infrastructure [1][2] Group 1: ISO 20022 Migration - The Fedwire Funds Service completed its migration to ISO 20022 in July 2025, aligning US high-value payments with global messaging standards, although many institutions relied on translation layers that limit the benefits of enriched data [3][5] - Future enforcement will require extended ISO data usage, compelling institutions that opted for quick fixes to reassess their strategies under tighter timelines and scrutiny [4][5] - Institutions that strategically planned for ISO 20022 are experiencing higher straight-through processing (STP) rates and fewer manual interventions, while those that did not will need to compensate for short-term thinking [4][6] Group 2: Strategic Differentiation - The adoption of ISO 20022 positions US wholesale payments closer to international standards, with banks that treat ISO as a strategic asset seeing advantages in fraud prevention, liquidity management, and customer service [5][6] - The European experience illustrates that initial minimum-compliance approaches can lead to later reinvestment as ISO matures into a competitive differentiator, a trend now emerging in the US [6]